MNI China Daily Summary: Wednesday, December 11

MNI BRIEF: Chinese Rail Passenger Numbers Break Record

MNI: PBOC Net Injects CNY37.3 Bln via OMO Wednesday

MNI: PBOC Sets Yuan Parity Lower At 7.1843 Weds; -1.22% Y/Y

MNI BRIEF: Brazil Not Even Close To Fiscal Dominance - David

CORRECTED-MNI BRIEF: Brazil Inflation Rises To 4.87% In Nov

EZ/UK Bond Supply Calendar: 4.25% Jul-34 Gilt Due Wednesday

EZ/UK T-Bill Calendar: 12-Month BOT Auction on Wednesday

MNI: JAPAN NOV CORP GOODS PRICE INDEX +3.7% Y/Y; OCT REV +3.6%

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

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INDIA: USD/INR Stages Shallow Recovery, GDP Data Eyed This Week

INDIA
  • USDINR is trading marginally higher on the session, extending the recovery from last week’s multi-week low of 83.0300. Price is back above both the 100- and 200-DMAs, though we remain some way off last week’s highs at around 83.5000.
  • Data-wise, GDP figures for Q1 are on the docket on Friday, where growth is likely to slow sharply from the 8.4% y/y rate recorded in the fourth quarter of last year (Est: +7.0% y/y). Results from the ongoing general election are expected on June 4, with a ban in place on exit polls in place until June 1.
  • Last week, the RBI transferred a record INR 2.1trln dividend to the government, likely led by higher interest earned on FX reserves and higher foreign exchange sales. Analysts say the unexpected windfall enhances the new government’s fiscal flexibility, while JP Morgan note that the brighter supply backdrop is coming against a strong year for foreign demand, as index inclusion next month inches closer.
  • Separately, Goldman Sachs have pushed back their RBI rate cut call back by one quarter to Q4-24 (vs. Q3 earlier), with the first cut most likely in the December 2024 meeting. They continue to expect a shallow easing cycle of total 50bp rate cuts from the RBI, with 25bp rate cuts each in Q4-24 and Q1-25. More cautious commentary from MPC officials justifies the call adjustment.
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